JobKeeper Package: Employers should 'proceed with caution'

'There are plenty of questions that should be asked before it passes through parliament'

JobKeeper Package: Employers should 'proceed with caution'

Employers should “proceed with caution” when registering for the newly announced JobKeeper package, as the finer details of the scheme are still yet to go before Parliament, according to Employsure.
 
Businesses are now able to register interest through the Australian Taxation Office for the federal government’s $130 billion JobKeeper wage subsidy to help keep workers on their books.
 
The proposed scheme means eligible employees would receive $1,500 per fortnight before tax from their employer for up to six months.
 
However, while it is pleasing to see that the government has stepped up to help keep businesses running, Employsure Founder and Managing Director Ed Mallett cautioned that things may still change between now and the time it becomes legislation.
 
"This is not law yet. I’m not saying it’s not going to be – the federal government seems confident in it. But there are plenty of questions that should be asked before it passes through parliament,” said Mallett.
 
“At the moment we don’t have clarity on how it would apply to casual workers with multiple employers, or at what point it supersedes any accrued leave eligible employees are already using during a stand down. And the advice around who is paying the superannuation on JobKeeper is about as clear as mud.”
 
Mallett said we also need to know about the type of work that might be permitted to an employee who receives the payment, especially if it's fundamentally different to the role that employee would ordinarily perform.
 
“With a Parliamentary process looming, I fear that the devil will be in the detail – which we’re still yet to see,” said Mallett.
 
“As it stands, very broadly speaking on a rough percentage, assuming your business qualifies for it, you could be looking at about 30 percent of your wage bill being covered.”
 
Mallett added that there is a risk you may see adjustments on this before it becomes law, such as the opposition taking the view that the payment is simply not sustainable as a cost to the country.

“This is not a promise from the government, it has to be legislated. At the moment it is just an idea.”
 
When addressing what employers should do over the coming days, Mallet said to hold off on making any decisions. His advice is to pause and wait and see what happens first. Explain to your employees that you’re trying to understand the finer details of the payment plan.

“Don’t rush into it and start paying extra money out of your pockets. Stay in cash preservation mode, see how this lands once it passes,” he said.
 
“You don’t know for sure that you’re going to get that money yet. Either because it won’t come into law in the format that has been proposed, or because your specific business and revenue can’t make the best of the payment as it’s set out.
 
“The government has come out with this big announcement, and asked employers to go back into the world of making sure they’re employing people. Maybe even getting workers out of Centrelink queues, who have previously been asked to be on leave without pay or stood down, and getting them back into the workforce.
 
“The government is going to have to look at this in a pragmatic way, remembering the purpose of it is to keep people employed.”

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